Monthly Archives: April 2020

WORKER STATUS, GIG ECONOMY AND SUBSTITUTION (29 April 2020)

The European Court of Justice (ECJ) has handed down an important decision providing commentary on the factors that may render a person to be a self- employed contractor rather than a worker.

The case was brought by way of a reference from the Watford Employment Tribunal for a preliminary ruling on the definition of what constitutes a ‘worker’ under the Working Time Directive.

The process of preliminary rulings allows national courts to put question to the ECJ which includes to clarify the interpretation of the EU Treaties, an EU law or of a national law based on or derived from EU law. The purpose of a reference is to try to ensure a uniform application of EU law throughout the European Union.

Summary of Facts

D was a courier engaged in delivering parcels under a service agreement with Yodel. The terms of that agreement included that D could:

  1. use subcontractors or substitutes to perform the service which he had undertaken to provide;
  2. accept or not accept the various tasks offered by Yodel, or unilaterally set the maximum number of those tasks;
  3. provide his services to any third party, including direct competitors of Yodel, and
  4. fix his own hours of ‘work’ within certain parameters and could tailor his time to suit his personal convenience rather than solely the interests of Yodel.

Decision

The ECJ considered that the above 4 factors the ECJ and provided a strong indication that D was not a worker, but self employed. The ECJ found that the independence of D did not appear to be fictitious. In other words, the terms of the Service Agreement reflected the reality of the situation. It is found that it was not possible to establish the existence of a relationship of subordination between D and Yodel. The ECJ was perhaps alluding here to a lack of sufficient mutuality of obligations (i.e. in respect of the obligation to offer work and the obligation to accept work that is offered.)

However, ECJ concluded that it is for the referring court, taking account of all the relevant factors relating to that person and to the economic activity he carried on, to classify that person’s professional status under Working Time Directive.

Commentary

There are a number of claims proceeding in the courts concerning the gig economy. Companies may wish to review any contracts in respect of self-employed persons to see if the above criteria reflects the reality of the situation and incorporated the wording into their contracts.

It will be interesting to see how the national courts apply this ruling.

http://curia.europa.eu/juris/document/document_print.jsf?docid=225922&text=&dir=&doclang=EN&part=1&occ=first&mode=lst&pageIndex=0&cid=8111564

 

Furloughed Employees? Check if You Have Enrolled for PAYE Online

If you have furloughed workers then you should check now to ensure that you have enrolled for PAYE online and have an ePay number.

Having enrolled for PAYE online is one of the requirements before being able to apply for the grant under the Coronavirus Job Retention Scheme; this enrolment can take up to 10 days.

It is likely that you only need to enrol separately if you did not get a login when you registered as an employer (which is is usually because you did not register online).

You will need this e-Pay number to apply when the portal opens on 20 April 2020.

If you need to enrol then you can follow the instructions on the link below.

https://www.gov.uk/paye-online/enrol

 

Job Retention Scheme (Furlough) to open on 20th April 2020

Jim Harra, HMRC Chief confirmed to the Treasury Select Committee on 8 April 2020 that the Portal for applications for the Job Retention Scheme (Furlough) will open on 20th April 2020.

The portal is currently being testing and they hope to administer 450,000 applications per hour.

Applications can be submitted 14 days in advance of running payroll with payments being made 4 – 6 (working) days thereafter (around 30 April 2020).

More information about how to claim is expected next week including what documents you may require.

HMRC has also confirmed anyone found to be knowingly defrauding the scheme will face criminal conviction.

Day 1 Right to SSP

We now have The Statutory Sick Pay (Coronavirus) (Suspension of Waiting Days and General Amendment) Regulations (Northern Ireland) 2020 (No.54) enacting a Day 1 right to SSP in limited circumstances.

These Regulations suspend the first 3 waiting days for:

They apply retrospectively from 13 March 2020 and the Regulations mirror the equivalent GB Regulations.

It is important to note that the suspension of the 3 waiting days is strictly limited to those with coronavirus symptoms or isolating as they live with someone who has those symptoms. For all other sickness, the 3 waiting days will continue to apply.

These Regulations can be downloaded from HERE

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